My Investment Blueprint

1 Introduction: In nine chapters I have compiled a guide that I use to structure my own investment approach – it comes from an individual investor´s perspective and experience. I put together a rulebook for strategic investing and trading to serve as a guideline to create and evolve a written investment plan to manage my…

Short Option Overlay for Trend Positions

One of the most frustrating things about a long- and medium-term trend strategy (including the super long-term trend following idea of buy-and-hold) is that prices seem to spend most of the time going nowhere and often retrace to give back a portion of those nice book profits. „The (buy-and-hold) investor only spends about 22% of…

Dealing with Sudden Market Regime Change

The realized return of different strategies and asset classes changes dramatically over time. Targeting these varying risk premia promises great opportunity – adjusting portfolio leverage at the right time has the potential to enhance profits in good times and curb losses in bad. The holy grail in investing would be to find ways to pinpoint…

Mistake Parade I

Large drawdowns are the most difficult time for an investor and trader. They are painful, but unavoidable when investing with the goal of high risk-adjusted returns. Return is based on taking risks and sometimes these risks are bound to materialize as strings of losses. This will happen regularly in a realm where each outcome is…

Focusing on Position Sizing

Rather than searching for the perfect strategy, the level of exposure to risk is a more important ingredient to successful investing. Every trading edge is going to be naturally constrained by the arbitrage activity of all market participants – extraordinary profit opportunities will be temporary at best. Asset classes, investment strategies (eg. value & momentum…

There ain´t no Secret

There is no secret trading or investment strategy, that will beat all others.   There are many ideas that work and they all work within very similar parameters – for example (average data from my backtests, books, articles, academic papers etc.): Trend following strategies  Whether you use moving averages, breakouts, RSI, Bollinger Bands etc., they…

A Barbell Portfolio Strategy

with a realtime review of portfolio performance during the recent market pullback. I want to take a look at some of my core portfolio strategies from a fresh angle. The basic principles discussed are easily transferable to other types of portfolios. A key portfolio feature, I strive for, is an adaptive combination of strategies with…

Isn´t it obvious? Switch from Bitcoin to Uranium.

How to constructively integrate speculative ideas in your portfolio. After making several thousand percent on your money in cryptocurrencies, the one thought on your mind is: „How can I do that again?“ Wild feelings are running amok, but recent signs of a bitcoin top may suggest looking elsewhere for crazily volatile speculation. Bitcoin daily price January…

Your Entry may be less important than you think

Choosing the right time horizon is of essential importance to find a viable edge for a trading strategy. Many short-term traders tend to show an unhealthy obsession trying to optimize trade entries. Long-term investors, on the other hand, often enter in an arbitrary fashion and could improve results by using broad entry criteria. My theory…

How much Time to Spend Actively Investing and Trading

One of my best trades in recent years has been to define a conscious time allocation for investing – specifically deciding how much time I should actively spend on trading and investment decisions. It has always been one of the hardest things for me to balance staying in tune with the markets, while keeping enough…